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2008 OPPS final rule

Patient Access Weekly Advisor, January 16, 2008

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CMS released the 2008 OPPS final rule (CMS-1392-FC) on November 1, 2007, and it took effect January 1. In addition to finalizing most of its proposals, CMS created a new type of APC in the rule-a composite APC-that in certain circumstances provides a single payment to cover services across the entire patient encounter.

"This final rule appears to contain the most radical changes to OPPS payment policy since its inception in August 2000," says Jugna Shah, MPH, president of Nimitt Consulting in Washington, DC. "Some of the changes are understandable regardless of whether they will be positive or negative for hospitals, but others are radical and raise the question of what pressures CMS was facing that caused it to move forward with so many significant changes all at once.

Wholesale packaging came as no surprise to Valerie Rinkle, MPA, revenue cycle director for Asante Health System in Medford, OR. "Without explicitly being able to articulate that wholesale packaging was on the horizon, I knew that Medicare was going to have to do something once they came out and said that they were going to use APCs for ambulatory surgery centers [ASC]," says Rinkle.

In order to level the playing field and have the APC system work for ASCs and hospitals, Rinkle knew that Medicare would have to do something drastically different-and it did.

"What they chose to do was to package absolutely as much as possible into APCs, so that the ASCs still bill the majority of services with just the surgical CPT codes," Rinkle explains. In the past, ASCs could only bill for surgical CPT codes and no other incidental CPT codes (e.g., radiology, respiratory), which, when compared to hospital reimbursement for a similar encounter, is very little.

Meanwhile, hospitals can bill surgical CPT codes along with other supportive CPT services, such as guidance imaging and respiratory care. Rinkle notes that if hospitals provide any other separately identifiable services (following CPT coding rules), they can bill and be reimbursed for those other incidentals.

"I think that the cost containment mentality is the secondary rationalization, says Rinkle. "I think the first rationalization is making the system work for ASCs and hospitals."

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